The definition of technically weak market’
Technically weak market reflects the fragile signals and negative values from the cash flow analysis or technical analysis. Common indicators that may show whether there was a technically weak market includes pre/linear decline (a/D), arms Index (TRIN) and moving averages.
Breaking down the ‘technically weak market’
As an example, the market in which the increase in average trading volume accompanied by a decrease in average prices, indicating a negative cash flow is a technically weak market. Bearish activity in the market is expected to continue. Similarly, with a decrease of average trading volumes that occur with increased average prices, there are signs that the purchase is the belief of fading (on the contrary, higher prices increase the volume of calls).
The advance/line of the fall is a popular tool to assess the overall internals of the market. If line a And D is negatively sloped and the market goes down, the market is considered technically weak. The appropriate measure of market breadth, which shows the degree of participation of shares in the market rises, is the index of the weapon. By the way, that this figure is calculated, a value greater than 1.0 indicates market activity and marking. More intuitive for the average investor moving average, or 50-, 100 – and 200-day varieties. The average investor can see where the current market line in relation to the moving average. Just a market where trading below these lines is considered to be in a weak state.
Technical analysts try to profit from price movements of securities. They believe that historical pricing trends tend to repeat, and with the help of price charts to identify these trends, they can determine the best time for buying or selling for profit. When they see a technically weak securities Market, a securities basket or the index, they can Express their barrel in the short positions.